The Nairobi Securities Exchange (NSE) has overhauled its derivatives market structure, reducing contract sizes for all single stock futures and recalibrating initial margin requirements.
- •From 1,000 shares to 100 shares for Safaricom, KCB, Equity, Absa, NCBA, Co-op, I&M, Kenya Power, KenGen, Kenya Re, Liberty, and Britam.
- •From 100 shares to 10 shares for EABL, BAT Kenya, and Standard Chartered.
The exchange said the move was designed to improve accessibility for retail investors and smaller institutions by lowering the cash outlay per contract.
In its 25 September 2025 notice, the NSE announced a tenfold reduction in the standard contract size for most equity futures: The changes, effective 1 October 2025, follow a technical review earlier in September that had raised margins across the board.
New Initial Margin Requirements (KES)
| Company | Dec 2025 | Mar 2026 | Jun 2026 | Sept 2026 |
|---|---|---|---|---|
| Safaricom | 350 | 400 | 425 | 450 |
| KCB Group | 650 | 700 | 750 | 800 |
| Equity Group | 650 | 700 | 725 | 775 |
| Absa Bank | 325 | 325 | 350 | 375 |
| EABL | 500 | 525 | 550 | 575 |
| BAT Kenya | 625 | 650 | 650 | 675 |
| NCBA Group | 775 | 825 | 900 | 975 |
| Co-op Bank | 275 | 275 | 300 | 300 |
| Standard Chartered | 475 | 500 | 525 | 550 |
| I&M Group | 600 | 600 | 625 | 650 |
| Kenya Power | 625 | 650 | 650 | 675 |
| KenGen | 225 | 250 | 250 | 250 |
| Kenya Re | 125 | 125 | 125 | 125 |
| Liberty Kenya | 300 | 325 | 325 | 350 |
| Britam | 125 | 125 | 150 | 150 |
| NSE 25 Index | 23,900 | 26,600 | 29,200 | 31,800 |
| Mini NSE 25 | 2,300 | 2,600 | 2,900 | 3,100 |
| Mini NSE 10 | 1,000 | 1,100 | 1,200 | 1,300 |
The adjustments mean that while the margin cost per contract is significantly lower, the exposure per share remains consistent with the risk-based methodology NSE Clear applies.
Background: Margin Review Earlier in September
Just a week earlier, on 18 September 2025, NSE Clear had raised margins across most single stock and index futures after its quarterly Historical Value at Risk (VaR) review.
That review applied a 99.95% confidence interval and a two-day liquidation period to determine higher margin levels. The published margins then stood at:
- •Safaricom KES 3,700 (Dec 2025)
- •KCB KES 6,700
- •Equity KES 6,600
- •NCBA KES 7,700
- •NSE 25 Index KES 23,900
Among others, reflecting increased market volatility and backtesting results.
Two-Stage Adjustment
The sequence of changes highlights NSE’s dual priorities: tightening risk controls while also promoting participation. The September 18 review boosted collateral levels to cover extreme risks. A week later, the September 25 notice reshaped contract sizes, cutting the ticket size of single stock futures to broaden investor access.
By lowering the entry cost of contracts without reducing the risk-adjusted margin per share, the exchange has attempted to balance prudential safeguards with market development. The derivatives market (NEXT), launched in 2019, is still in early growth stages, and the reforms are expected to improve liquidity while ensuring systemic protection.
